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EXCLUSIVE: Secretary of Labor details changes in unemployment insurance program to combat fraud

Posted at 6:00 AM, May 11, 2021
and last updated 2021-05-11 09:20:10-04

BALTIMORE — Maryland is reopening, but thousands are still out of work. These jobless workers have waited months for their unemployment insurance benefits and many still have questions on when they’ll see relief.

WMAR-2 News Mallory Sofastaii spoke exclusively with Maryland Secretary of Labor Tiffany Robinson about the impact fraud has had on legitimate claimants.

WATCH the full interview below:

New benefit payment options
The most recent change is how claimants will be paid. The state is doing away with Bank of America debit cards. Direct deposit or paper checks will take their place.

According to the Secretary, around 72 percent of all claimants have made their selections before the May 21 deadline. The majority choosing direct deposit.

“Benefits go directly into a claimant's bank account. New claimants won't have to wait that 7-10 days to receive a card. It's safer because through direct deposit, there's no risk of a debit card being sent to the wrong address or lost in the mail or stolen. These were some of the issues that were happening with Bank of America debit cards,” said Robinson.

On May 24, claimants will receive benefits via their new payment selection.

On August 1, debit cards will be deactivated.

Maryland was one of only three states that didn't previously offer direct deposit. Secretary Robinson said this was due to a contract issue.

"We have a lot of customers that liked the debit card system and we were under contract with Bank of America through the Treasurer's Office and the debit card system was put in place many years ago. Obviously, I would've loved to have had direct deposit in place prior to this pandemic," said Robinson.

Thousands of accounts frozen
While the deadline to select a new payment method is quickly approaching, claimants whose accounts are locked have been unable to make any changes in BEACON.

“As soon as their documents to verify their identification have been verified, they will then receive the same prompt in their portal,” Robinson said.

Many claimants don’t know when that will happen. It's a tedious process that’s taking weeks.

RELATED: Surprise shut off: Unemployed workers discover benefits are frozen until state can re-verify IDs

“You would be surprised the documents that get uploaded that look really close to a real passport or a real driver’s license and some states allow out-of-state licenses for in-state work, so our team reviewing these documents has to know every state’s identity documents and what’s real, what the holograms look like. We’ve provided manuals and training to compare and contrast,” said Robinson.

According to a department spokesperson, over 587,000 claims have been flagged for fraud during 2021 and more than 41,000 claims are pending document review.

"It’s definitely not happening across the board. It’s happening in conjunction with best practices and triggers in our system," said Robinson.

The U.S. Department of Labor has advised states to continue paying claims if a determination isn’t made in a timely manner. Maryland isn't yet doing that.

“Once we have flagged a claim for fraud and a claimant has uploaded verifying documentation, we’re not going to pay a claim until that documentation has been verified,” said Robinson.

A spokesperson added that the department is just now beginning the process of planning for implementation. Once the federal government's guidance is fully implemented, the identity verification procedures for new and continued claims will be updated.

In addition, the department is close to selecting a vendor to automate the process. In February, Secretary Robinson said that would happen in the coming weeks. Now, she hopes it'll be by this week.

“It absolutely has taken longer than we anticipated and such is the way of procurement. I asked for procurement flexibility this legislative session during the pandemic for reasons like this and we were not granted that, so we must follow the state rules and regulations regarding state procurement. This was a competitive procurement. We have had to ask additional questions of some of those vendors and get additional demos because some of their proposals are not apples to apples and it’s really important that we look at the technical side of those proposals and the price before we go to [the Board of Public Works] and get approval for those contracts. so we’re doing what’s best for our customers and what’s best for the state,” said Robinson.

PUA Overpayment Waivers
For those who received overpayment notices, the federal government released guidance last week on granting waivers to PUA claimants who may have been overpaid due to no fault of their own.

The Secretary said the department is working to re-program their system and expects to send out instructions to eligible claimants soon.

Issues verifying bank account information
If you’re having issues verifying your bank account information, look for micro-deposits in your bank account.

Wells Fargo sends small amounts of money, usually under a dollar, to confirm your account is able to receive direct deposits.

Once you confirm the deposit amounts, your payment information will be updated.

If claimants select paper check as their new preferred payment method, they are required to verify their address in their BEACON portal, even if it has not changed. If claimants do not select their preferred payment method May 21, their benefit payments will NOT automatically default to paper check because of the address verification requirement.